When agency owners start selling their thinking, they aren’t really sure how to charge for it cuz they are used to just selling their time.
Well, as you begin to package your IP (intellectual property) into things like training, programs, workshops, consulting, coaching, courses, and more…
Pricing can be a little “mysterious”.
I get it.
Well, in this episode I want to break down the only 3 things you can sell, how those get packaged up by the most successful, and what you can be charging for them.
Transcript / MP3
There’s really no science to how they even ch how they even charge for their done for you service services, as it is, and, or their projects outside of charging. For time, I wanted to kind of talk through like the only things that you, as an agency owner can price and sell. And then when you look at the, how you’re going to deliver it, the, the… , how you’re going to deliver it and the, what you’re actually positioning and packaging to your client is going to be in one of these three areas or a combination of, um, which should help you figure out how you can price things. And then I’m going to give you some examples of just general ballpark margins. If you go by any sort of high ticket coaching consulting program, what you can expect, um, either in, in investing in those things and or if you were to package up your expertise in one of these ways, what you might be able to charge for it. So I’m just going to kind of throw out some data at you and some things, information that I think can help you start to wrap your head around what ballparks you should be in and how you might want to consider pricing your stuff. Does that sound good? Let me know if that sounds good. And then if you joined us in the replay, uh, hit me with the hashtag replay. So let me go to my iPad here. All right. So now you can all see my iPad. So three things that you can price and sell. There are really only three. My friend, there are really only three. And if you’re just joining us, um, there should be a link in above this video that, that you can click on that will allow me to see your name inside of the live stream. Um, cause I’m not in Facebook right now. Uh, I’m streaming and Facebook, but I’m not in Facebook. So, uh, Vanessa, I was in there when I saw that you posted hashtag freestyle that I just put on the screen, but, um, otherwise I will not know who you are unless you click on that link. But nonetheless, there are really only three things that you can price and sell and your services right now will fall within one of these things. So, uh, number one is inputs commonly known as time and materials. Many of you agency owners, freelancers probably base if you don’t sell hours or days or sprints right now, um, you probably, when estimating your projects will say, Hey, this is what my time is worth. I charge X dollars an hour or this consultant or freelancer that I work with commonly cost me X dollars an hour. So I’m going to up Mark that by a little bit. And so we estimate that this is going to take X hours. So I’m going to quote this project at X hours, right? Including materials, maybe there’s certain, you know, hard assets or things that you might be weaving into, whatever you fulfill on that you might have to account for. So the first thing is inputs, which quite simply is time and materials. Um, now If you currently sell inputs your hours, your days, or you ballpark your project costs, uh, or your proposals based on the number of hours and materials, then I want you to write the word inputs. Okay. The second thing that you are able to price and sell is deliverables. Now some of you might have, um, realized that, Hey, like there are certain costs for, uh, and value to certain deliverables, like a website or a strategy or a certain system that you install in someone’s business. And you have created a likely, a fixed price to deliver, said things, Hey, for social media management, we are going to charge X dollars a month. Okay. And what they get is a deliverable of, you know, X number of posts. Um, this is where you’ll start to kind of see elements of, you know, more productized, uh, sorry, I’m drawing product right in prototypes right here, productized services showing up in here where it’s like, Hey, you’re getting X of these things now, commonly we’ll see people sell blocks of time thinking that that’s a deliverable, but that’s still really an input. When I think of deliverables, I think of they’re receiving specific things. Um, they’re getting, you know, X number of blog posts, written X, number of emails, X number of pieces of creative, or this website, or this many campaigns. There is a specific thing that is being handed over as a part of the deliverable that they are buying, right? And that you’re selling, you’re saying, Hey, you’re buying this thing and I’m going to deliver it to you. And it’s priced basically and sold basically on you selling them on a deliverable and then buying the deliverable. It’s not, Hey, how many hours does it take you to get to that deliverable? Maybe you backed into that somehow shape or form, but the way you’ve positioned your stuff is around the delivery. Well, and the third is, is outcomes and or results, outcomes, or results. This is where you start to get into the value based pricing Where we’re looking at, Hey, if I do this thing for you, it’s worth X because it’s going to help you create this outcome or this result in The business world agencies, Things like that. If your service, uh, you, you will commonly see at least IC the thing that you’re selling is somewhere around 10 to 20% of the value that you will create for that. You’ll see that really, really common. Um, so if you can help, if the thing that you is going to help them generate a hundred thousand dollars, you can definitely charge 10 to $20,000 because you probably asked yourself if you were to spend 10 or 20 and make a hundred, you would probably find ways to do that over and over and over again. Now with the value based, right, that 10 to 20% of result or outcome, if that’s a starting point, right? So this would be the starting point. This is the starting point 10 to 20% of the result or outcome. This number this 10 to 20% can actually go up with your confidence slash you can say guarantee. If you can guarantee that if they, if you can guarantee someone the result or the outcome, and you have the confidence that you can deliver exactly on the promise, you can charge more period, but that obviously comes with more risk. What if you don’t, there are some people that are really confident in their results, and if you’re super confident and you can sell the prospect on that confidence, then the percentage that you can justify is going to be higher. So I often see that that 10 to 20% is very common in the realm of, Hey, it’s very much worth this. You would do this over and over again, but there’s also some risks that you might not get exactly that result. And so for that, I’m, I’m only charging 10 to 20% of what I’m going to create for you. But if I was a hundred percent certain that I could generate you a million dollars, like, would you pay me half a million, like 100%, you will make a million. If you give me half a million, like the conversation starts to change. So value based pricing is a lot different and the percentage that you can command or the, the, um, the amount or the value that you can command is going to heavily be based on the confidence and guarantee in which you can produce the results that you promised. So quick recap, there’s really only three things we can sell. We have the inputs, we have the deliverables, and then we have the outcomes and the results. So right now you probably are doing one of those things. Um, what I find is that if this is, you know, your price that you charge, right? Um, and this is your experience, all, even kind of say that this probably plays out well, and I’ve never drawn this graph, or your ability to specialize. You can charge more. If you kind of hit these milestones, Like you can’t charge as much for it, Inputs and materials, then you probably have your deliverables. You can probably charge more for that. And then up here and beyond And up is outcome and results, value based pricing. So as you have more, More experience, and as you have more of a specialty in solving a specific problem, the likelihood is you’re going to be able to increase your rates. And when you specialize, you can, it’s usually the specialization is the catalyst in allowing you to go from inputs into specific deliverables. You deliver those things enough, enough times to the right client over and over and over again. You’re going to have an idea as to how valuable that is to them and to how, how confident you are in, in generating those results that you’ve promised to then warrant the raising your rate, Right? This is why specialization Is really, really important as it come, as it relates to price and values. Because if you start to deliver the same thing over and over and over again, you’re going to get pretty good at delivering those results, which could mean that your clients could get the result faster, with more confidence, with more of a guarantee. And as you focus on it, you can get more efficient and a lean in regards to how fast and efficiently you can get them to those results. You’re going to be ironing out that process. And so, as we specialize, right, we almost naturally end up following the trajectory of, we go from selling in time and materials to deliverables, to outcome outcomes and, and, uh, outputs. So where does that bring us, um, in our world right now, you do a lot of done for you work. Um, that looks like projects Ex that looks like a, you know, custom or bespoke dumb for you. A lot of times will equate, always Will equate to Inputs, least On, on some, either prospect and or the delivery, the delivery person, the agency is very much focused On this. Then we Enter kind of the done with you world, where you have coaching, you have kind of high ticket consulting, training and workshops. The delivery model is a little bit different. You know, you’re collaborative, you’re in a room for two days, your providing some content. Um, these can be priced a couple of different ways, depending upon what you’re selling. These could be deliverables. These could be value outcome, or it could be a combination of, right. Hey, when we go through this process, you’re going to have these things in place which have a value. And if you implement them correctly, following our strategies, the upside is this. So like, if you follow our step-by-step, this system can create X over and over and over for you. And if you can convey that value, you can raise that price. So like our program, we have some deliverables, some sales, automation, and some systems that you would have to eventually have paid someone to install in your business anyway, or create, we’re going to drop those into your business functioning systems that operate seven figure businesses from a lead acquisition and sales process perspective. So like there’s a deliverable component. So when you’re done working with us, you will have that system in place, but having in place and utilizing it and getting the, the value that can come from running leads through it and adopting it and implementing, applying to your business is where the value starts to come in and through our training and our framework, we can show you, Hey, here’s how you fill that pipeline. Here’s how you package your stuff so that you can charge X. And here’s how you’re going to make it from that. So our delivery a lot, I think a lot of coaching and consulting programs, um, and you could possibly argue some courses cause we’ll be kind of either deliverables value and outcomes and results and, or a combination of, and then you kind of have your DIY, which again, I think could be a combination. This could be your courses is, you know, your books, products you put in there, right? Um, you can have those which typically are going to, uh, again, can be both deliverable and could also be outcome, right? If you follow my course, you’re going to have the framework to do X, Y, Z, or you’re going to set up the system or, um, or if you do this, you can generate X dollars. So you can con you can even do that with DIY as well. Um, the fact that you’re bringing in, uh, I guess even with dun dun dun, if you, if people are getting one-on-one access and stuff like that. Yeah. There, there is a little bit of input. There is a little bit of, Hey, you’re getting access. You’re getting time. But through the done with you model, it’s usually not one to one, one it’s one to many. So it’s more leveraged and profitable for you, but you have the ability to work with a lot of people and still be involved, which again will justify you having any cases. And I’m speaking in a good amount of generalities. Yeah. Uh, raising the price up. So that being said, if you’re an agency owner and you’re looking to package up your expertise, you have to look at these things as to, okay, well, even if I package it up, what are they actually getting? Are they getting specific deliverables? Is there an outcome or result, um, how can we take deliverables and, or inputs and time of heroes and repackage them to help our clients get an outcome? That’s very much a possibility. Um, but here’s kind of what I see, just what I see in the marketplace. Um, a lot of our clients come to us and they are currently doing, you know, a done for you services. Um, that range ProjectWise anywhere from, you know, three K one time to, you know, I’ve seen up to 50 K you know, for a project or they try to sell a retainer and it’s like 2000 a month, you know, retainer, which I’m going to do a whole separate video on my YouTube channel about the monthly recurring revenue, uh, ins and outs, uh, because I think a lot of agencies get it wrong, not going into that today, but oftentimes you’ll see people charging somewhere around this. Uh, and I’ll say sometimes I see even go up to 5k, uh, for retainers as, as average. And then you move over to this done with you model, which is the training, the consulting, um, and you can get anywhere from three to, uh, you know, front end, I’ll kind of break this down in the coaching and consulting world. You’ll see a lot of people, self run end, And these Are your, you know, eight to 12 week experiences or courses, uh, courses with coaching. Uh, and these can range anywhere from two K and up to, you know, commonly, you know, some cases 15 K and then you’ll see the back end offer, which could be six months Too. I’ve seen 15 plus months, And that can go anywhere from two to, you know, I’ve seen 5k a month for, for that duration. So you kind of see that, um, you know, 12 to, you know, to 36, commonly 36 K plus, Uh, For the total program, right? That’s not con like if you’re, if you’re talking to the gurus, right? The, the high ticket coaches and consultants, their programs are probably going to be somewhere in that ballpark. If you hop on the phone and they’re not telling you the price likely it’s going to be one of those things, um, we’re within these ranges as well. And you’ll see that, like, that’s really common. And then you have your, you know, your DIY courses, um, ballpark again, anywhere from, you know, 47 bucks up to, I’ve seen, you know, 3000 to 4,000 for courses that literally have no access whatsoever to a human being. Like it’s just Online coursework. So Again, I’m speaking in a lot of general generalities, but the, like, if you look at kind of the industry and you’re an agency owner or a service provider, and you’re like, I want to package up my expertise into this thing. How do I price that with my services? Like these are common areas where you’re probably going to end up, you have to look at what are you actually delivering and how does that then put you into one of those sliding scales of on the low end or on the high end, based on, is this purely based, or is it deliverable and outcome? And the outcome has crazy upside and the likelihood is really high that they’ll get it. That price is going to go up and, or, uh, in some cases it’s just, Hey, you have a really big reputation. And a lot of people want to work with you. And for that, you have a lot of authority and you can be on the higher scale as well. Um, so do you need to figure out your, um, do you need to figure out how much your fulfillment costs, whether you’re doing done for you done with you or DIY yes. You have cost to acquire, you have costs to deliver. There’s going to be, even if you’re in a group program, like your coaching team, or you yourself can only handle so many people on a given call where they’re getting the appropriate experience. So you’re going to have to say, okay, well for each coach, they can handle X number of people and they’re spending X hours. And so you can get down to a number of, it costs me X for every incremental person that comes into my program. And you obviously want to make sure that whatever you’re charging is profit. Cool.
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